Is Your Business at Risk?

Conflict between the old industry licences and the new industry leases

It has been drawn to our attention over the past few months, that there may be Work Authority holders (those extracting material from Crown land) who would not have current leases in place with the Department of Sustainability and Environment (DSE).

This, in most instances, has came about because the old Extractive Industry Licences and the Extractive Industry Leases issued for the extraction of material from Crown land, were superseded by Work Authorities issued under the Extractive Industries Development Act 1995.

Previously, the Extractive Industry Lease and Licence in most instances would have been issued by the same department.

Correspondence with the member who brought this to our attention, and the Work Authority holder they are representing, has highlighted the issue pertaining to the lack of advice and information made available at the change-over.

This is a deeply concerning issue as the ramifications puts into question both the commercial viability, and the resulting value, of such a business.

The change saw many Work Authority holders assuming that they only required a Work Authority to operate out of Crown Land, and in good faith these members have continued making annual compensation payments to the DPI whom they assumed remained their Land Manager.

As a result, our members businesses may be jeopardised from:

• A lease agreement with rent rises at rates over 300% every review (as with the Mt Granite Quarries example we are presently addressing with our Minister).
• A lease or licence agreement which may not be offered or renewed – which is the Land Manager’s right under the Extractive Industries Development Act.
• A lease agreement which may only be offered on an annual basis with annual reviews (as with the above mentioned example now before our Minister).
• A lease agreement with revised conditions that compromise the viability of the operation. (Eg. minimum tonnages, restricted working hours, or a requirement to pay a market rent based on land values, over and above the mandatory Crown royalty).

It is essential therefore that all members working on Crown Land ensure that they hold the Land Manager’s consent and if appropriate a Lease Agreement (in most cases this will be the DSE).

Information on Crown Land leases and licences is available from the CMPA website and consists of two Fact Sheets and a standard lease agreement.

It is absolutely essential that you work through this issue as already one member has found they are only secured for a 12 month period at maximum!

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